United Arab Emirates Country Profile - Cost of Living

Geographical variation

Although there are now foreign nationals living and working all over the UAE, the original expat growth areas were Abu Dhabi and Dubai, and these remain the most expensive places to live. The country’s low tax rates mean that the general cost of living is low, with day-to-day essentials such as food and clothing very reasonably priced. However, with space at a premium, accommodation is extremely expensive. Family costs such as schooling and childcare can also eat into the budget for foreign nationals, particularly in the largest cities.

Accommodation

Despite the relaxation of restrictions on foreign nationals buying property in the UAE, the laws surrounding purchase differ greatly between emirates and can be quite complex. The vast majority of the large expat community continue to rent, particularly given how difficult it can be to gain UAE citizenship for the long term. To rent a property you will need to provide proof of earnings and may have to pay estate agent fees. However, rental agreements in the UAE are usually quite favourable for the tenant as rents are capped and there are strict rules around evictions. If a landlord wishes to sell their property, they must give tenants notice of 12 months. A typical tenancy lasts for a year with rent paid monthly, but be aware that for shorter lets you may be required to pay the entire rent up front.

Rental deposit

Deposits are usually around 5% of the tenancy value. Rent is normally paid monthly via direct debit or using the more traditional system of post-dated cheques. When using cheques to pay your rent, remember that if a cheque bounces in the UAE you are committing a criminal offence.

Property tax

In some regions property owners are charged a municipal property tax of between 2% and 15% of the property value. Tenants may have to pay an equivalent tax – approximately 5% of the rental value of the property. Contact a reputable estate agent to find out what charges will apply to your property.

Utilities

Utility supply in the UAE is managed by each emirate. Most have a publically-owned or contracted supplier and tariffs are heavily subsidised so prices are usually fairly reasonable. Telephone and internet services are provided by Etisalatand Du, but with limited choice of providers you will find prices relatively high.

TV licence

In the UAE there is no fee for television ownership and programming is available in many languages. There are several free English-language channels, as well as paid services available through Etisalat and Du.

Healthcare and medical costs

The standard of medical care in the UAE is good, but foreign nationals usually have to pay for it. However, if you are an expat resident you are entitled to apply for a health card. The cost is approximately AED500 and you will also need to pay to renew it periodically, but it will allow you to access subsidised healthcare services. Nevertheless, it is recommended that expats in the UAE take out private medical insurance as in the event of long-term illness or serious injury, costs can mount up very quickly. For more information, consult the UAE Government Portal website.

Shopping

Shopping is a popular pastime with both tourists and residents in the UAE. There are a large number of modern shopping malls offering the latest fashions and brands, while traditional souqs are the places to go for bargains. Grocery shopping can be done reasonably cheaply, particularly as several large multinational supermarkets now have a presence in the UAE.

VAT

Although there is no value-added tax charged at a federal level in the UAE, there has been speculation that an equivalent will be introduced in future. Some of the emirates charge taxes or levies on particular services, such as hospitality and hotel accommodation.

Price guide

Rent on 1-bedroom apartment in city centre – AED6,273.69 (≈£995.30) per month